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Unipro: Waiting for Berezovskaya relaunch

Unipro: Waiting for Berezovskaya relaunch

Unipro presented a consolidated 1H 2018 report in August of 2018. We have upgraded our financial model and accounted the recent financial and operation numbers in it. We downgrade the target share price 3.5% down to RUB 2.99 and change the recommendation from “HOLD” to “BUY”.

We upgraded our DCF model and accounted the recent financial and operation numbers, updating suppositions on the cost of fuel. Given resulted in EBITDA and net profit targets downgrade 3.8% and 4.8% respectively. Nevertheless, we expect the output volumes to start recovering in 2H 2018. Our price target for Unipro is down by 3.5% at RUB 2.99, yet the recommendation is upgraded from “HOLD” to “BUY” due to quoted dip from their levels in May. We expect the cash flow of Unipro to be supported by increased DPM payments on the unit 3 of Berezovskaya GRES from late 2019. More to that, the payments on modernized stations (the exact volume of capacities for modernization has not been disclosed yet) will provide for extra support to the stock of Unipro. For now, the shares of Unipro might considered as an attractive interesting story. The company keeps its free cash position up and still is one of the most efficient and high-margin gencos within the segment.


Author: Alexey Adonin


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